Apartment REITs Underperform

By Michael Aneiro

Apartment REITs continued to underperform in the first quarter, as their 2011 outperformance, the seasonal “housing hope” trade and the potential sale transaction of Archstone contributed to that underperformance, according to Stifel Nicolaus.

The top three apartment REIT performers in the first quarter were the three apartment REITs in the S&P 500: AIMCO (AIV) at +16.1%, Equity Residential (EQR), at +10.4%, and AvalonBay Communities (AVB) at +9.0%. More from Stifel:

Although there was some leasing seasonality in 1Q, we expect that the good 2011 spring and summer leasing seasons should provide strong year-over-year results in 1Q12. Our 1Q12 estimates assume year-over-year revenue growth of 4.0%-7.0% this quarter led by Post Properties (PPS), Camden Property Trust (CPT), and AVB. We estimate that Home Properties (HME), AIV, and AEC will be laggards.

Amey Stone is Barron’s Income Investing blogger and Current Yield columnist. She was formerly a managing editor at CBS MoneyWatch, MSN Money and AOL DailyFinance. Her responsibilities included overseeing market coverage and personal finance topics. Prior to those roles, she was a senior writer at BusinessWeek where she authored the Street Wise column online and contributed to the magazine’s Inside Wall Street column. Topics covered included economics, corporate finance, Fed policy, municipal bonds, mutual funds and dividend investing. She co-authored King of Capital, a biography of Citigroup Chairman Sandy Weill. She is a graduate of Yale University and Columbia University’s Graduate School of Journalism.